Life Insurance Trust Explained w Ease of Understanding
There are many types of trusts that can provide financial advantages for you and your family some offer control love how will be distributed to your heirs others create tax efficiencies by positioning assets outside if your taxable estate and irrevocable life insurance trust can do both an ILIT as it's commonly called takes your life insurance policies and moves them outside your estate and into a trust here's how and I'll it works and why it can benefit your family when you create an ILIT you designate the trust as the beneficiary of your life insurance policies the death benefit proceeds from your insurance will become property of the trust you determine it and how those funds and the ILIT will be used typically your spouse your children and the charities have your choice will be the recipients of the trust assets you decide who receives the assets and when they will be dispersed you appoint a trustee to manage the eyelid and ensure your wishes will be carried out according to your instructions the cash inside the island can provide immediate funds to your family to pay your final expenses and the state taxes your heirs can avoid the need to liquidate family assets like real estate or business interest to cover those obligations ILIT assets will not increase your overall the state tax burden the assets and the ILIT are held outside your state so there's a reduced exposure to estate taxes and the possibility of greater wealth transfer to future generations if you think an irrevocable life insurance trust would be a value to you work with your financial advisor legal and tax experts they can structure your ILIT to help achieve your family schools you've worked hard to create your wealth you want to protect it so your family can enjoy the benefits of your success
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